You may want to post this on the Microsoft message boards as it sounds like a possible limit or maybe there's an environmental parameter that can be set in Windows to allow more connections.
Note: you posted in the Dell|EMC section. I think EMC only validated connecting to up to 4 Clariion SAN arrays. If each array even had 8 iSCSI ports, you still wouldn't exceed 32 targets. How do you have 256 targets?
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